Short-term: support populations most effected by trafficking trafficking Long-term: change societal norms and create sustainable options that increase dignified work and address root causes of trafficking.

“Its impossible to get dressed, drive to work, talk on the phone, or eat a meal without touching products tainted by forced labour.(1)” (1) US State Department, Trafficking in Persons Report, 2010

US Department of Labour lists over 120 different goods produced using child or forced labour globally in the agriculture, manufacturing, and quarried industries.

SB 657: CALIFORNIA TRANSPARENCY IN SUPPLY CHAINS ACT SB 657 Highlights(2): Effects “retail sellers” and “manufacturers” Company must be doing business in California and have $100 million or more in annual worldwide gross receipts Mandates effected companies disclose what they are doing to address trafficking in their supply chain. Disclosure must be “conspicuous” and “easily understood” Law only requires disclosure. It does not necessitate action or policy be company. (2) Senate Bill 657 accessed: /sb_657_bill_ _chaptered.html

WHAT COMPANIES ARE EFFECTED? An estimated businesses are subject to the Act, based on the following interpretation of the legal requirements(3): The company is organized or commercially domiciled in California; Sales of the company in California exceed the lesser of $500,000 or 25% of total sales; Real property and tangible personal property of the company in California exceed the lesser of $50,000 or 25% of the taxpayer’s total real property and tangible property; or The amount paid by the company in California for compensation exceeds the lesser of $50,000 or 25% of total compensation paid. (3) K&L Gates, California Transparency in Supply Chains Act – First 90 Days

FIVE AREAS THE LAW COVERS Companies must disclose whether they… Engage in verification of product supply chains to evaluate and address risks of human trafficking and slavery. Conduct audits of suppliers to evaluate supplier compliance with company standards Require direct suppliers to certify that they are compliant with relevant labour laws Maintain internal accountability standards Training on human trafficking and slavery provided to management

VERIFICATION: Required: Discloses information on the verification of product supply chains The use of a third party to verify product supply chains Recommended: conducts a tracing project to identify locations of unknown producers publishes a public list of suppliers, including country, name and addresses States how many suppliers the brand has traced > > “Traced” defined as knowledge of suppliers name and locations

AUDIT Required: Discloses information on monitoring Identifies if monitoring is independent, third party, and unannounced Recommended: Disclose auditing information, including suppliers monitored and frequency Discloses statistics on unannounced visits or off-site worker interviews conducted The company discloses information on the use of labor brokers The company shares broad monitoring results publically

CERTIFICATION Required: Whether materials incorporated into company products are certified (in compliance with country laws in which they are doing business) by direct suppliers Recommended: Disclose direct suppliers' relationships at inputs or raw materials suppliers Use of a third party certification system that certifies suppliers down to the raw materials level

INTERNAL ACCOUNTABILITY Required: Information on internal accountability standards and procedures Recommended: Code of Conduct that addresses labor standards Includes standards (Ex. Vendor Code of Conduct) in supplier contracts Preferred supplier program (to promote suppliers that demonstrate better and improved labor conditions) Functioning grievance mechanism that includes investigation and efforts to address grievance.

TRAINING Required: Whether employees and management are trained on human trafficking and risk mitigation in supply chains Recommended: The company discloses information on financial support towards training.

SB 657 & BEYOND Status of SB 657 Does not mandate companies do anything. The first step is transparency % of companies are believed to not to be complaint with SB 657. Similar legislation has been introduced in the UK and the US at the federal level. Beyond SB 657 creates an opportunity to engage in a broader sourcing conversations with companies. Labor issues now on the agenda of many companies, previously unengaged in them. SB 657 is only the first of potentially other similar legislative efforts.